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Less than half of IFAs expect the market for variable annuities, or pension products with unit-linked guarantees, to grow in the next year, according to research by MetLife Europe.

It added six out of 10 advisers expect confidence in the market will be boosted by more product launches and more providers entering the market. Standard Life is set to launch its product at the end of the year.

Research conducted with 163 IFA clients of SimplyBiz in May also highlighted that 63 per cent of IFAs believe a lack of knowledge about the products will hamper the market's growth.

Do you believe the market for variable annuities will grow this year?

Source: MetLife Europe using SimplyBiz IFAs.

MetLife uses the term unit-linked guarantees to describe the features offered to avoid confusion with US products. It added unit-linked guarantees enable clients to opt for a range of solutions to meet their client needs.

Dominic Grinstead, strategic development and marketing director MetLife Europe, said: "Unit-linked guarantees provide an excellent solution for advisers and their clients to the uncertainty posed by inflation and stock market volatility, which are both at the forefront of investors' minds at present."

Nick McBreen, an IFA for Cornwall-based Worldwide Financial Planning, said that variable annuities are "too complex."

He said: "The case for these products does exist, however they are too complex. There are lots of products and they are too complex which will be a stumbling block. The adviser is being careful and cautious about embracing something that they are uncertain about. The half that said that the market will grow are probably the people who have embraced them because they seem like a good idea. If an IFA is not 100 per cent clued or confident about them they will not recommend them to their clients and rightly so.

"I think that there are so many companies coming into the market and you say to yourself 'How do I explain the products to my clients?'. There are lots of these products in the US, but I am not sure if it will follow through over here."

Ian Thorneycroft, managing director of IFA SimplyBiz, said: "The unit-linked guarantee concept is relatively new to the UK and advisers are still relatively unfamiliar with it."